FEC Holds Audit Hearing, Debates Advisory Opinion Request

The FEC today held a hearing on an audit staff finding that former Rep. Quico Canseco’s campaign accepted $100,000 in illegal contributions. The Commission also held an open meeting at which it considered an advisory opinion request from Enterprise Holdings, Inc.

According to a staff audit report, Rep. Canseco’s 2010 campaign accepted $100,000 in illegal campaign contributions from a Mexican corporation called Caza. Rep. Canseco’s attorney, Chris Gober, argued at the audit hearing that the funds were in fact a loan from the candidate’s personal funds, claiming that the loan represented the candidate and his sister’s equitable interest in a partnership that owns a 99% stake in Caza. Under federal law, candidates may not accept contributions from foreign corporations; they are, however, permitted to provide unlimited funding to their own campaigns. In accordance with the FEC’s audit process, the Commission will formally vote on the audit staff’s recommendations in this case at a later date.

At its open meeting, the Commission considered an advisory opinion request from car rental company Enterprise Holdings, Inc. concerning whether its federal PAC could use a payroll deduction program to raise funds from certain employees living in New York. Under federal law, corporate PACs may use this method to raise money from eligible employees. However, a New York State Department of Labor regulation appeared to conflict with the federal statute, prompting Enterprise Holdings to ask whether the federal statute preempted state law.

The New York State Department of Labor submitted comments on the request, stating that its regulation did not in fact prohibit payroll deduction programs for federal PACs. The Commission’s Office of General Counsel (OGC) took the position that in light of these comments, the advisory opinion request was rendered moot, or hypothetical. Commission Chair Goodman disagreed, and engaged in a lengthy discussion with Acting Associate General Counsel Adav Noti over whether the request was still valid. All the Commissioners appeared to agree that the requestor should be allowed to conduct the payroll deduction plan, and that they were entitled to explicit guidance from the Commission on the matter. However, there also appeared to be a consensus that the Commission needed additional time to formulate a response. Accordingly, the Commission decided to postpone a vote on the request until the Commission’s next public meeting, to be held on June 26.

Search

About This Blog

In the Arena: Law & Politics Update offers readers news and analysis on a wide range of topics related to the laws that regulate and affect political activity. Attorneys in Perkins Coie’s nationally recognized Political Law practice will provide insight and guidance on legal developments involving campaign finance, lobbying, the Federal Election Commission, and other topics of interest to those active in the political process. The blog’s current contributing authors include Brian Svoboda and Jonathan Berkon, as well as others in the Perkins Coie Political Law Group.

Stay Connected

About This Blog

In the Arena: Law & Politics Update offers readers news and analysis on a wide range of topics related to the laws that regulate and affect political activity. Attorneys in Perkins Coie’s nationally recognized Political Law practice will provide insight and guidance on legal developments involving campaign finance, lobbying, the Federal Election Commission, and other topics of interest to those active in the political process. The blog’s current contributing authors include Brian Svoboda and Jonathan Berkon, as well as others in the Perkins Coie Political Law Group.